Strong growth in consumer credit
- Marius Hagen, Lars-Tore Turtveit and Bjørn Helge Vatne
- Economic Commentaries
Consumer credit has grown rapidly in recent years. While consumer credit accounts for a small share of total household debt, it represents a substantial portion of household sector credit losses. Tax assessment data indicate that a considerable portion of consumer debt is held by older age groups. The high interest rates on consumer credit give lenders substantial lending capacity and enable them to absorb high losses. A substantial share of consumer credit has been extended by specialised banks that are largely funded by deposits guaranteed by the Norwegian Banks' Guarantee Fund.
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